Usage and experience of the certification process for continuing liability to UK social security contributions

Question 1

1.  Executive summary

Accepted Answer

1.1 Background, purpose and method

The UK has a number of bilateral and multi-lateral social security co-ordination agreements, which, amongst other things, determine which country’s social security scheme a worker in a cross-border situation pays contributions into. The aim is to ensure workers (and their employers if they have one) only pay into one social security scheme at a time. The most used of these are the 2 agreements with the EU that provide for social security coordination: the Withdrawal Agreement and the Trade and Cooperation Agreement.

In order for workers to demonstrate to a host country that they are only liable to pay contributions into their home country’s scheme under one of the agreements, they must apply to their home country’s social security institution (HM Revenue and Customs in the UK) for a certificate to verify this. Depending on their circumstances and the terms of the agreement, this may be as a detached worker or a multi-state worker.

A detached worker is someone who is:

an employee who works for an employer in one country (their home country) and is sent to work temporarily in another country (the host country)
a self-employed person who normally carries out an activity in one country (their home country) who temporarily carries out a similar self-employed activity in another country (the host country)

In contrast, a multi-state worker is someone who works regularly (either alternately or simultaneously) in more than one country. A multi-state worker normally pays into the social security scheme where they reside if they carry out a substantial activity there.

HM Revenue and Customs (HMRC) commissioned Kantar Public UK to conduct a piece of research on their behalf to better understand current customer awareness, understanding, use and experience of certificates in order to improve the customer experience of applying for one. The overall aim of this research was to understand when and how customers are using the social security certificate in practice and the customer experience of applying for certificates.

From August to September 2021, Kantar Public UK conducted 50 in-depth qualitative interviews with recent applicants for certificates across 3 specific audiences:

self-employed or sole traders who complete applications themselves
employers who complete applications on behalf of employees and employees who receive these certificates
and agents who complete applications on behalf of their customers, split during analysis into low-volume/non-specialist agents, high-volume/non-specialist agents, and high-volume/specialist agents

1.2 Awareness, understanding and use

Awareness of certificates was mixed across audiences participating in this research. Only specialist, high-volume agents had high levels of awareness and understanding of the requirement, whilst for all other audiences awareness was contingent upon business need. Across all audiences, awareness was perceived to have increased over recent years as client requirements for workers to have a certificate and penalties for non-compliance have become more common.

Most respondents correctly understood the basic purpose of the certificate was to prove to the destination country that under the relevant social security co-ordination agreement the worker pays social security only in the UK, and to prevent having to pay social security contributions in both the UK and the destination country (‘double charging’). However, more detailed understanding varied according to the frequency with which the certificate had been used.

Respondents’ decision-making around which trips to apply for a certificate for was based on 4 interlocking factors: destination country, length of trip, client requirement and sector. The way in which certificates were used varied significantly by sector. For sectors that involved site work – such as construction, manufacturing, and oil – the certificate was used even for very short trips, as it was often a requirement for site access due to audits and spot checks. Similarly, in the performing arts sectors, the certificate was often a requirement of the client or tour promoter. In contrast, for professional and office-based sectors, the certificate was most commonly used for trips of a few weeks or more, rather than short trips.

Linked to their low awareness and understanding of the certificates generally, understanding of the impact of the UK’s exit from the EU on social security co-ordination legislation was low among participating self-employed/ sole traders, employees and low-volume/non-specialist agents. They had little or no awareness of changes to legislation, application forms or certificates. Participating employers and non-specialist, high volume agents had a slightly higher level of awareness, with some awareness of changes to the application form and certificates as a result of the WA and TCA. The audience with the highest level of understanding of the impact of the UK’s exit from the EU were specialist, high volume agents. They were aware of minor changes to the application form and certificates and understood the difference between WA- and TCA-related changes.

1.3 Application experience

Respondents experienced the application process in 4 stages: finding the right form, applying for the certificate, post-submission of the form, and receiving the certificate. Overall, most respondents faced challenges when applying, ranging from minor frustrations to major issues.

Respondents who were specifically advised they needed an A1 or CCL were able to find the form quite easily. Some reported being sent a link to the form by their employer or hosts while others found the form on the gov.uk website. However, some respondents reported confusion between the different application forms, including the application form that must be completed to receive an S1 certificate (for health care in the EEA/Switzerland).

When applying for the certificate, most respondents experienced some (often minor) issues due to confusion with particular questions, attachments and/or a lack of clear guidance. Agents and employers suggested that the form needs to be adapted for those applying on behalf of others, particularly for groups.

All audiences described experiencing some uncertainty following the submission of the form, often due to unclear or inconsistent timings for receiving the certificate, especially for self-employed/sole traders. Some agents and employers also experienced the form disappearing and becoming untraceable after submission, while some employees reported no receipt of application. Some had errors in the certificate that needed correcting. Some respondents said that these delays often impact business payments and planning.

Where respondents needed to contact HMRC, they reported long wait times, inconsistent case worker responses, and – for agents – difficulty in accessing authorisation forms.

1.4 Potential changes

The research explored customers’ ideas of potential changes to improve the application experience, with particular focus on 5 potential changes to the application process.

A digital certificate was proactively suggested by respondents during the interviews, and nearly all respondents would welcome the change. In particular, agents would welcome the introduction of a digital certificate as it would make their job easier. Many respondents would not need a paper certificate, as long as they could print the digital certificate themselves as needed. However, this is contingent on destination countries accepting this, as some countries do not currently accept a digital or printed version.
Most respondents would welcome a detailed status tracker that gave up to date information on an application’s progress. Agents and employers felt it would support working relationships with clients and employees by enabling them to provide updates to them on their application’s progress, as well as be key to avoiding lengthy and frequent calls to HMRC for updates on an application’s progress.
There were mixed feelings across audiences on whether having a single form for all workers would be beneficial, as opposed to choosing from different forms. For those in favour, respondents think it would be useful for applicants that have less expertise on the types of workers (ie detached worker, multi-state worker) that exist and that are unsure how to use the forms. However, it is important to note that many respondents did not view this potential change as relevant for themselves but could see how it may be helpful for others.
Most respondents viewed a form which remembers information, or ‘auto-fill’, as helpful. The key information the form would need to remember includes National Insurance number, business and occupation information, and past travel. Some agents have data security concerns and expressed uncertainty over how an auto-fill function would work if remembering the information of multiple different clients.
Respondents commonly do not re-apply for a certificate if their circumstances change, therefore a change of circumstances form is seen as less necessary by most. Some would use a change of circumstances form if there was one – particularly those staying in the same country for longer.

Question 2

2.  Introduction

Accepted Answer

2.1 Background

The UK has a number of bilateral and multi-lateral social security co-ordination agreements, which, amongst other things, determine which country’s social security scheme a worker in a cross-border situation pays contributions into. The most used of these are the 2 agreements we have with the EU that provide for social security coordination: the Withdrawal Agreement (WA) and the Trade and Cooperation Agreement (TCA). The aim is to ensure workers (and their employers if they have one) only pay into one social security scheme at a time and are not double charged. The general principle is that the worker pays into the country’s scheme where the work activity takes place, irrespective of where the worker resides or where their employer is based. However, there are a number of exceptions to this general rule; the most common are:

A detached worker, this is someone who is:

an employee who works for an employer in one country (their home country) and is sent to work temporarily in another country (the host country)
a self-employed person who normally carries out an activity in one country (their home country) who temporarily carries out a similar self-employed activity in another country (the host country)

A multi-state worker, which is someone who works regularly (either alternately or simultaneously) in more than one country. A multi-state worker normally pays into the social security scheme where they reside if they carry out a substantial activity there.

In order for the worker to demonstrate to the host country that they are only liable to pay contributions into their home country’s scheme under one of these agreements, they must apply to their home country’s social security institution (HMRC in the UK) for a certificate to verify this.

2.2 Research aims

HMRC commissioned Kantar Public UK to conduct a piece of research on their behalf to better understand current customer awareness, understanding, use and experience of certificates in order to improve the customer experience for those customers applying for a certificate. This will help HMRC ensure that future changes to the application process are the simplest and most effective for customers.

The overall aim of this research was to understand when and how customers are using the social security certificate in practice and the customer experience of applying for certificates. The specified research questions included:

what is the profile of social security certificate users (for example, their communication preferences, travel frequency, awareness of social security certificates)?
what is people’s understanding of the social security certificate process in terms of eligibility, who needs to apply, when they should apply etc?
how much is social security co-ordination a consideration when people look to work abroad? How do they come to use the scheme?
what is the experience of customers applying for social security certificates? What are the differences between EEA/Swiss and non-EEA/Swiss countries?

A crucial consideration when undertaking the research was to understand the impact of customers’ experience on businesses (for example, delays, loss of work etc).

2.3 Method

2.3.1 Sample

Kantar Public UK conducted 50 in-depth qualitative interviews with recent applicants for certificates from August to September 2021.

Interviews were recruited to cover 3 specific audiences:

Audience	Definition	Number completed
Agents	Those with the legal authorisation to represent the individual or employer	21
Employers and employees	Those working as part of an organisation	12
Self-employed and sole traders	Those working for themselves	17

Interviews were also recruited to meet specific quotas against key criteria relevant to each audience, including type of work (taking into account single vs. multi-country and destination country), frequency of use, business size and business sector. The breakdown of the final interviews against these characteristics is as follows:

Type of work: Indicative of the destination and posting type each respondent had experienced; categories were not mutually exclusive.

	Agents	Employers/Employees	Self-employed/Sole traders
Detached worker traveling to a single country in the EEA or Switzerland	15	5	8
Detached and multi-state workers with multi-country postings within the EEA and Switzerland	21	5	6
Workers travelling to a reciprocal agreement country (not EEA or Switzerland)	14	2	3

Frequency of use: Indicative of the degree of experience each respondent had in applying for a certificate. Not asked of agents.

Use per year	Employers/Employees
Less than 3 times per year	8
3+ times per year	4

Use ever	Self-employed/Sole traders
Less than 3 times	12
3+ times	5

Business size: Indicative of the overall size of the business based on employees or turnover. Not asked of agents.

Number of employees	Employers / Employees
Less than 20 employees	1
20-50 employees	6
More than 50 employees	5

Business turnover	Self-employed/Sole traders
Less than £20k a year	5
£20-£50k a year	6
More than £50k per year	6

Sector: Indicative of the primary sector business operates in. Not asked of agents.

Sector	Employers/Employees
Professional and administrative services	6
Construction and manufacturing	3
Other sectors	3

Sector	Self-employed/Sole traders
Creative arts sector	9
Professional and administrative services	5
Other sectors	3

2.3.2 Fieldwork

Interviews took place from 25 August to 8 October 2021, by telephone or video call and lasted 45 minutes. Respondents were asked about their awareness, understanding and use of certificates, and their experience throughout the application process including contact with HMRC and their experience of this. Lastly, 5 potential changes were tested on respondents, and they were asked to suggest any changes they would like to see to the application process.

2.3.3 Agent sub-groups

During analysis, agents were split into 3 distinct groups indicative of their relative experience, due to the impact this had on their responses. These 3 groups are:

non-specialist, low volume: often an accountant who applies for certificates on an ad hoc basis
non-specialist, high volume: often an accountant or other tax advisor who applied for certificates regularly for customers
specialist, high volume: those who are specialist social security advisors and apply regularly for certificates, typically from the HMRC Expat Forum

Question 3

3.  Awareness, understanding and use

Accepted Answer

This chapter begins by exploring how respondents became aware of the requirement to apply for a certificate before going abroad to work. It then examines understanding of the purpose and use of the certificate, how this varied between different audiences, and some misconceptions and common gaps in understanding. The factors that influenced decision-making around whether and when to obtain a certificate are then discussed, and the section ends with an exploration of the impact the UK’s exit from the EU had on awareness and understanding of the purpose and use of the certificate.

3.1 Awareness of requirement

Awareness of certificates was mixed across audiences.

For self-employed/sole traders, employers and employees, awareness was prompted by:

a client requesting that they obtain a certificate, often refusing access to site or delaying payment without one
receiving a penalty for not having a certificate when working abroad, which could, for example, be in the form of delayed payment until a certificate was obtained or refused access to site, a fine applied by the social security authority/ other public body within the host country, or being charged social security in both the UK and host country
and employers researching requirements for business travel post-UK’s exit from the EU, and in doing so, finding out about the certificate requirement

“I had never heard of the A1 document until I started working for this customer and it was actually a requirement to be able to gain access to the shipyards.” (Employee, Manufacturing)

Amongst agents, non-specialist agents typically only became aware of the requirement when a client came to them requesting a certificate as social security agreements had not been part of their professional training. In contrast, specialist, high-volume agents had high levels of awareness and understanding of the requirement, and only this group cited the Workers Enforcement Directive as having contributed to a general increased awareness of social security certificates among clients. Across all audiences, awareness was perceived to have increased over recent years as client requirements for workers to have a certificate and penalties for non-compliance had become more common.

“A client mentioned that they needed one, and I’d never dealt with one previously, that’s how it came about.” (Non-specialist, low volume agent)

3.2 Understanding of certificate purpose

Most respondents correctly understood the basic purpose of the certificate was to prove to the destination country that the worker only pays social security in the UK, and to prevent having to pay social security contributions in both the UK and the destination country at the same time. However, more detailed understanding varied according to the frequency with which the certificate had been used.

Less frequent users included non-specialist, low volume agents, self-employed/sole traders, and employees. These audiences did not typically proactively research the wider purpose of the certificate and when it should be used. They therefore did not generally have an understanding of when or where the certificate was required except for the specific trips they had used it for. Certification was typically not top of their mind when preparing to travel and these audiences would only apply for a certificate when prompted, such as at a client’s request.

“I genuinely have no idea and […] I don’t really have the time to look into why [the A1 is used].” (Self-employed/Sole Trader, Events)

These audiences had major gaps in their understanding and some significant misconceptions about the certificate. A common gap was that the certificate was not needed for all work-related travel, but only for specific destination countries: certificates were generally only considered when working in the EEA and Switzerland and awareness of certificates available when traveling to other countries which the UK has reciprocal agreements with was low. Those with experience of travelling to the reciprocal agreement countries, such as the US, were not aware that they could apply for a CCL at the time. Misconceptions raised by a minority of these respondents included that the certificate is a requirement introduced post-UK’s exit from the EU to prove eligibility to work in the EU; allows HMRC to calculate a worker’s UK tax liability; and/or that the A1 certificate or CCL ensures health care cover abroad.

Another key gap in understanding was the difference between a detached worker and a multi-state worker. Typically, these audiences did not know the difference between these 2 types of workers and, as a result, did not know which they qualified as and therefore which form they should apply with. This led to different approaches to the application, with different applicants with the same pattern of business travel applying for certificates in different ways.

Respondents with greater experience of using the certificate, including employers and high-volume agents, had a higher level of understanding of the wider purpose of the certificate and circumstances when it was required, including supporting legislation and directives.

“It’s so that everybody knows that taxes are being paid to one country, but also that they are not paying taxes twice. We do it for every trip, we like to make sure it’s covered.” (Employer, Manufacturing)

For these audiences, certification was a standard part of preparing for business travel, and they often had specific queries for niche situations, such as whether and how to use a certificate for students on a placement with a company, and people who are directors of multiple companies in multiple countries.

3.3 Use of certificates

Respondents’ decision-making around which trips to apply for a certificate for was based on 4 interlocking factors: destination country, length of trip, client requirement and sector.

Destination country: Respondents with more experience and understanding tended to judge whether the destination country was expected to be more or less vigilant in ensuring the requirement was met. Certain countries were more commonly perceived to be more vigilant and therefore more likely to check that a worker had a certificate.

Length of trip: It was considered impractical to apply for certificates for very short trips, particularly for large businesses whose employees travelled regularly. Therefore, a ‘cost versus compliance’ analysis was carried out to assess when a certificate was needed. Employers set their own thresholds for the length of trip over which a certificate was used: this ranged from 10 to 90 days, with 10 to 20 days being most common. Specialist agents typically recommended that certificates were obtained for trips over 5 to 10 days.

“Five days [is] the threshold that we would recommend…if we said to our clients, they had to obtain A1s for every single day of travel it would be administratively far too burdensome on everyone, on us and on HMRC.” (Specialist, high volume agent)

“When they’re there for a day or 2 we don’t need to do it - anything more than a few days [I] would apply for it. I haven’t read this in guidance, but they are literally doing one day’s work so they’re not going to pay taxes for one day’s work when they would pay their taxes here anyway.” (Employer, Manufacturing)

Client requirements: Whether or not the client requested that the worker obtained a certificate for a particular trip was a key determinant of the use of a certificate. This was particularly true for certain sectors (see below) and self-employed/sole traders.

Sector: The way in which certificates were used varied significantly by sector. For sectors involved site work – such as construction, manufacturing and oil – the most common destination countries were the Netherlands, Belgium, Spain and Italy, and the certificate was typically used for single trips of several weeks or months to a single destination country. It was used even for very short trips, as it was often a requirement for site access due to audits and spot checks. For professional and office-based sectors, common destination countries included France, Spain, Germany and Belgium. In this sector, longer trips of a year or 2 were also more common than in other sectors, as some workers were posted on secondments. The certificate was typically used for trips of several weeks or more to a single country, rather than for short trips of just a few days. In the performing arts sectors, a wide range of countries in both Eastern and Western Europe could be visited on a single tour, with short visits to each country. In this sector, the certificate was often a requirement of the client or tour promoter.

There were some instances where the certificate was used for non-travel purposes, including for: income from a property rental, income from ongoing royalties in one country, and living in/working from the UK but employed (and paid) by a company in another country. These examples all involved EEA destination countries.

3.4 Impact of the UK’s exit from the EU

The UK’s exit from the EU created 2 competing misconceptions around the requirement for A1 certificates among respondents. One was the misconception gained by some self-employed/sole traders and non-specialist agents during negotiations that certificates would no longer be required post exit. In contrast, some self-employed/sole traders and employers who had only become aware of the requirement since the UK’s exit from the EU assumed it had become a requirement as a result of this and had not been required previously.

Understanding of the impact of the UK’s exit from the EU on social security co-ordination was low among participating self-employed/sole traders, employees and non-specialist, low volume agents. They had little or no awareness of changes to legislation, application forms or certificates as a result of the UK’s exit from the EU. Participating employers and non-specialist, high volume agents had a slightly higher level of awareness, with some awareness of changes to the application and certificates as a result of the WA and TCA.

“I think the letter has changed slightly to say it’s a different agreement? To be honest, I’ve not really read very thoroughly on this. I realise there are some changes, but I’ve not looked at it in depth… It’s an assumption.” (Non-specialist, high volume agent)

The group with the highest level of understanding of the impact of the UK’s exit from the EU were specialist, high volume agents. They were aware of minor changes to the application form and certificates and understood the difference between WA- and TCA-related changes.

Across all audiences, a clear outcome of the UK’s exit from the EU was perceived to be increased scrutiny and vigilance from destination countries, with the requirement to obtain a certificate having become more common.

“Pre-Brexit some EU countries would be like ‘we should really have it but if you haven’t got it, it’s fine.’’ (Self-employed/Sole Trader, Performing arts)

Question 4

4.  Application experience

Accepted Answer

Overall, most respondents faced challenges when applying, ranging from minor frustrations to major issues. The application experience follows 4 stages: finding the right form, applying for the certificate, post-submission of the form, and receiving the certificate.

4.1 Finding the right form

Most respondents found the detached worker application forms easily, especially when an A1 certificate was specifically requested. Some self-employed/sole trader respondents reported being sent a link to the form by the venue or company they were working with, and some employees were sent links to the form by their employer. Some respondents were given a form number by HMRC which they looked up online.

“They [tour promoter] sent over a pdf on ‘this is how you apply for it’, a how to guide to make sure you don’t mess it up.” (Self-employed/Sole Trader, Performing Arts)

However, some respondents were unclear which form was needed. Respondents that did not receive a link to the specific application or a specific request for it expressed confusion between the detached worker and other forms, particularly the multi-state worker forms; more specifically, they were often uncertain over whether their work situation would make them eligible for an A1 as a detached worker or as a multi-state worker. There was also confusion over A1 and S1: some respondents were unsure which certificate should be used to provide healthcare coverage.

“It’s how to find the right [form] to do. I thought I had the right one because it was employees posted in an EU country, which sounds right, but I got a letter saying I need to complete a different form. Maybe because they are directors of their own company it’s a different form? But it’s not really clear online which one you have to do.” (Non-specialist, low volume agent)

4.2 Applying for a certificate

Respondents who were familiar with the application process were more at ease when filling out the application form. Specialist, high volume agents and experienced self-employed/sole traders found applying easier: they reported that the form was straightforward to fill out and viewed the application form as clear and simple, often copying and pasting answers from previous applications to save time.

“It felt very straightforward and I didn’t have to fill in too much detail.” (Self-employed/Sole Trader, Professional, Scientific and Technical)

The application process was also fairly easy for employees who had an employer or agent complete the application form on their behalf. However, sometimes employees described having to chase up with their employer about details in the form and provide personal information. Employees that had to fill out the form themselves were often unfamiliar with the form and experienced difficulty responding to specific questions in the form.

“Thank god [the agents] were there.” (Employee, Banking)

Employers and non-specialist, low volume agents reported the most difficulty filling in the application form. They were often confused over particular questions and had issues gathering employee/client data, particularly when filling out multiple applications for individual employees/clients belonging to the same company.

4.2.1 Difficult questions within the application form

Five questions in the EEA/Swiss forms were noted as being the most difficult to complete, often because the information requested may not exist or seems unnecessary.

Respondents noted difficulty with a question on their 5-year history of work abroad. Many respondents struggled to understand the need for this question in the A1 applications. All audiences felt the question asked for too much unnecessary detail.

“If you put yes to that [question] you have to give a full breakdown and I just think that’s overkill really.” (Non-specialist, low volume agent)

Another difficult question on one application form was about earnings made while working abroad. Respondents do not always know how much they will be paid, especially for longer contracts. Some respondents also felt confused about what needs to be disclosed in terms of salary, particularly for self-employed/sole trader respondents. For example, one self-employed/sole trader respondent highlighted that it is hard to estimate how much will be paid in royalties after the work is done. Across different sectors, respondents reported having travelled for contracts and projects that lasted multiple months or years. During this time, they were not earning a set amount per trip and often did not know how many trips they might make over the contract period. This made providing information on their salary difficult.

Respondents reported similar issues with a question on the exact dates they are going to work in a host country. They highlighted that filling in exact dates seems excessive and not always feasible. For many sectors, it can be difficult to know the exact dates they will be abroad.

“It’s impossible to know what dates we’re going to be there and how long we’re going to be there.” (Self-employed/Sole Trader, Manufacturing)

Another unclear question asked for the address where the respondent would be based when working abroad. Respondents wondered whether they should list the client site, the local or head office, or any other entity when answering this question.

Finally, respondents noted the similarity of 2 questions on living or working overseas in the application form. Respondents felt they had to repeat themselves and were confused over why the question came up twice.

“The same question has always been repeated twice on the form, about working overseas, which I never quite understand. I feel like I’m completing the same information twice. It’s at the middle of the application and the very end as well. It’s not absolutely identical in the actual question, but they are asking the same question.” (Specialist, high volume agent)

4.2.2 Other key issues about the form

A lack of guidance on the form was also identified as a key complaint by respondents. All audiences, even experienced agents, felt the form needs accompanying guidance to explain question rationale and clear instruction on what is needed. Key areas respondents wanted more guidance on are the amount of detail required, including whether a full breakdown of their information is needed when answering questions within the form. They also wanted guidance related to particularly the questions that are most difficult to complete, including what to do when salary is unknown or uncertain, as well as which address to put down (as noted above).

“Some guidance notes that explain what’s required and why it’s required would actually be helpful.” (Specialist, high volume agent)

Another complaint respondents had was on adding attachments to the form. Some Self-employed/Sole Traders did not know how to attach additional information (for example additional dates for gigs) anywhere on the form – or even that it was possible.

“Would have made everything so much easier if there was a part where it said you could attach additional documents as supporting information.” (Self-employed/Sole Trader, Arts)

Agents were often unable to attach a 64-8 form to the application. (Note: 64-8 forms are agent authorisation forms. These are required for tax agents to engage with HMRC on a client’s behalf.)

4.2.3 Form and authorisation process does not always suit how employers and agents use the form and needs to be adapted for certain situations

For agents and employers applying on behalf of others, the process for doing this could be challenging, particularly for groups. Employers and agents reported having to make identical applications for different employees which they found to be a very long, repetitive, and unnecessary process. They would like a more streamlined process instead of having to do each individual application.

“It’s time I think I could be using doing value added work.” (Employer, Mining)

Agents also reported issues with the need for individual authorisation made on behalf of individual clients within a company. In some cases, HMRC requires individual authorisation for the employees travelling abroad, as well as the overall company application. They report that there is inconsistency in when this is requested by HMRC, which leads to uncertainty about when to go through the process of individual authorisation.

Some employers had difficulty with the question on EU settled status as they believe that they are not allowed to ask employees whether they have EU settled status due to discrimination laws. Some employers reported receiving conflicting advice from UK government departments as to whether this information can be asked from employees.

(Clarification by HMRC: There is no legal barrier to requesting this information, however employers should ensure this is done in a non-discriminatory manner and aligns with the Home Office guidance and code of practice.

4.3 Post-submission experience

Following submission, each audience experienced a degree of uncertainty over their application. The greatest source of uncertainty was not knowing the status of their application or when they might receive the certificate. For agents and employees, this becomes particularly challenging as they cannot tell clients or employees when they will receive the certificate.

“The wait is a real problem […] anywhere from six days to six months later. If I was waiting 6 months every time for the paperwork, that would have a massive impact on my finances.” (Self-employed/Sole Trader, Events)

Employees also reported that they do not get confirmation when someone applies on their behalf and, as a result, have to follow up with their employer or agent to better understand the status of their application. Similarly, agents and employers reported that they do not get notified when an employee or client receives the form, which they often need to check.

“From a negative point of view, once it’s submitted you don’t get a progress update to see where the application is.” (Non-specialist, low volume agent)

4.3.1 Receipt of certificate

Inconsistencies in receipt time were reported to have knock-on effects for each audience. Generally, certificates were received between 3 weeks to 4 months after application, with complicated cases taking much longer.

“It really varies, it really does. I can do one today and I could get it in a week. Whereas I could do one after this and wait 6 weeks. There’s no pattern at all.” (Specialist, high volume agent)

Some respondents reported that delays led to financial impacts. Specialist agents and employers experienced added time and resource cost (due to chasing updates); for self-employed/sole traders and some other respondents, delays prevented their ability to carry out the job or delayed a payment. Some respondents became subject to dual liability due to the delays.

“It has stopped the promoter from releasing money for everyone to get paid… you just have to wait for it to come through… then everyone can get paid.” (Self-employed/Sole Trader, Arts)

Agents also reported a negative impact on their client relationship as a result of inconsistencies and delays, as they were unable to provide updates and found it difficult to explain inconsistencies in receipt times, contributing to further client dissatisfaction.

“It is normally not an easy conversation to have, because as I said, clients would expect HMRC [and agents] to make their life easier…especially when they travel abroad.” (Specialist, high volume agent)

Further, once received, some respondents found errors on their certificates that meant extra effort and wait time to get a correct certificate sent through. Common issues included incorrect name, address, dates and nationality.

“When it was returned it [the A1 certificate] said I was a Bulgarian citizen.” (Self-employed/Sole Trader, Arts)

Respondents felt that paper certificates contributed to slow receipt times. Paper certificates were viewed as impractical, outdated and not sustainable. Most respondents scan and send the certificates to relevant people once received so do not understand the need for paper.

4.4 Contacting HMRC

During the process of applying, respondents’ contact with HMRC was prompted by a need for more guidance, status updates, and handling errors on the certificate, with status updates being the most common reason to contact HMRC.

“We want to please our client no matter what […] it’s our responsibility and we have to look proactive, that we are doing everything we can to get it as quickly as possible.” (Non-specialist, low volume agent)

Some respondents had a positive experience with contacting HMRC, typically reporting useful guidance on filling out the form and HMRC being able to amend issues with the certificate swiftly. However, most other respondents found contacting HMRC about the application a challenging experience, reporting a lack of direct contact, long wait times and issues with caseworker handling. The lack of direct contact meant some respondents had to call a central HMRC number and wait to be passed to the right person. They expected to be able to contact HMRC online or at least have a direct point of contact to call, particularly for simpler queries.

“I cannot believe you cannot contact them online.” (Self-employed/Sole Trader, Arts)

The long wait times and general effort it took to get through to a caseworker caused particular frustration for respondents. They reported being directed to an initial automation message, then being transferred between caseworkers and sometimes departments, and experiencing long waits whilst on hold.

Once speaking to a caseworker, respondents also found that the information they were provided was inconsistent or unsuitable. Many reported receiving conflicting information on the same or identical applications. For example, multiple respondents were told they need an A1 by their client/employer, then told by HMRC they do not need one even when a client/employer overseas has requested it.

“Every time I have to call HMRC I have to take a deep breath and gear myself up. You just don’t know who you’re going to get - it’s the real luck of the draw.” (Specialist, high-volume agent)

A number of respondents reported having to make multiple calls to get the information they need. For example, some reported a maximum number of questions they can ask to a caseworker, while some employers or agents outlined that they can only check on 2 to 3 employees at a time.

Respondents reported impacts to their business from having to go through this process, for example submitting repeat applications to achieve a faster outcome or paying to use an agent.

These frustrations were greatest for agents and employers handling high numbers of applications because of their more frequent engagement with HMRC. Agents reported experiencing difficulties demonstrating their authorisation to act on clients’ behalf, with caseworkers struggling to find submitted 64-8 forms. They suggested having dedicated caseworkers or direct contact points/persons to help escalate issues.

“Sometimes if you get a caseworker that can’t find the 64-8, they will just cut you off then and say, ‘I can’t tell you anymore, I can’t discuss it’. You know what I do? I hang up and call straight back again and I’ll get someone completely different who will tell me a completely different story.” (Specialist, high-volume agent)

These issues when contacting HMRC contributed to a feeling of scepticism toward the advice and support provided by caseworkers.

4.5 Unusual circumstances

While most applications were standard, a minority of respondents experienced ‘unusual circumstances’ such as short-notice applications, retrospective applications or changed circumstances.

Short notice applications were most common but also most problematic. Respondents reported that if going abroad at short notice they will apply for a certificate but often travel without proof of certificate as it will not have been sent to them in time, as some destinations accept proof of application without certificate as it can be provided later. However, some respondents reported negative impacts, including no site access or delayed pay. Across all audiences, respondents expressed an interest in a process that allowed for short-notice applications.

Very few respondents had applied for a certificate due to a change in circumstance. Most employees and self-employed/sole trader respondents did not re-apply if their circumstances changed, instead getting a new certificate. In most cases this was because they did not know there was a process for changed circumstances, whilst others felt a new application was faster. When they did apply, this was due to extending the period of work abroad or changing destinations. Some applied for an additional certificate to cover extra countries or time, rather than a change.

Few respondents had applied retrospectively. Agents were those most likely to apply retrospectively on behalf of clients. This was commonly due to human error with unrepresented individuals not filling out the application form correctly or being subject to a compliance check abroad. Agents would then gain these individuals as clients and retrospectively complete the form on their behalf.

4.6 Agent use

Use of an agent depended on the applicant’ confidence and capability. Many large employers participating in the research reported agents being used for wider accountancy services. For example, large employers with high employee numbers had service contracts with specialist accountancy firms, so automatically directed anything tax- or HMRC-related to their agent. Agents also reported that some clients lack confidence interacting directly with HMRC and so employ an agent to do so on their behalf. Furthermore, they reported that some clients had tried to apply themselves but encountered difficulties, such as making errors on the application form, having their application rejected, or being unsure which application form to use. In some cases, clients had not applied for a certificate due to being unaware, then faced penalties imposed (for example having to pay social security contributions in 2 countries) for not having a certificate before approaching an agent for help.

“We had one recently who came to us because he didn’t understand which form to use and didn’t have all the information to hand. That’s why they’ve got us basically, to save them time.” (Non specialist, low volume agent)

However, other respondents chose not to use an agent. Specifically, many self-employed/sole traders found it easy to apply for certificates and did not consider it worth paying an agent to complete the application on their behalf. Some employees found they received sufficient guidance from their employer so did not need an agent’s help. Employers who were assigned to facilitating employees’ travel saw it as part of their role to apply for certificates, so did not consider using an agent.

“My job is to facilitate travel; an agent would be a waste of money.” (Employer, Manufacturing)

Question 5

5.  Potential changes

Accepted Answer

The research explored customers’ ideas of potential changes to improve the application experience, with particular focus on 5 potential changes to the application including: a digital certificate; a digital status tracker; a single intelligent form instead of choosing from multiple forms; a form that remembers your information and automatically fills it in; and a change of circumstances form.

5.1 Digital certificate

A digital certificate was proactively suggested by respondents during the interviews, with most respondents welcoming this. Agents were particularly in favour of this as it would make their job easier.

“It would be easier for us as it would enable an agent to take a digital copy and pass it on to the client.” (Non-specialist, low volume agent)

A digital certificate was viewed as a way to improve sustainability and ease of access, and many saw the change as a necessary step in terms of keeping up with modern technology and the process of digitalisation.

“The less cutting down of trees that HMRC does the better!” (Non-specialist, low volume agent)

Many respondents would not need a paper certificate, as long as they could print the digital certificate themselves as needed. However, this is contingent on destination countries accepting this, as some countries do not currently accept a printed version. Respondents would like reassurance from HMRC that if a digital certificate is introduced, there will be confirmation of acceptance from destination countries.

Very few respondents were against the introduction of a digital certificate.

5.2 Digital status tracker

Most respondents would welcome a detailed status tracker that gave up to date information on an application’s progress. Respondents proactively suggested 3 ways in which a digital status tracker would help them.

Working relationships

Agents and employers view a status tracker as key to communicating with clients and employees and providing updates to them on their application’s progress.

“It means if the client rings for an update we have the information. That would be useful.” (Non-specialist, low volume agent)

Prevent respondents from calling HMRC

A status tracker is viewed as key to avoiding lengthy and frequent calls to HMRC for updates on an application’s progress.

Identifying delays and acting accordingly

A status tracker would be helpful if it showed information needed to effectively manage the process and their/their clients’ expectations. It should show whether an application has been received, whether it’s in progress, if there are any issues arising with the application, an estimated time of when it will be ready, and if and when it is completed or sent to the applicant.

“Rather than just ‘processing’. If they said it was going to be posted tomorrow, then we’d know that and can plan around it.” (Self-employed/Sole Trader, Manufacturing)

5.3 Single intelligent form

There were mixed feelings across audiences on whether having a single form for all workers would be beneficial, as opposed to choosing from different forms. Respondents in favour thought it would be useful for applicants with less understanding of the distinction between the different application forms (ie CA3837/CA3822 for detached workers, CA8421 for multi-state workers, and CA9107 for CCLs if doing work in reciprocal agreement countries). A single form was also viewed as a good way to save time in avoiding mistakes in filling out the wrong form. Of particular note, some respondents wanted to see a form that adapts based on one’s answers, so that they are only required to fill out what is needed for their given situation.

“Rather than applying for the wrong one and them writing you back, you could do it all in one form - that would be perfect…. It would save time and the client could maybe even do it themselves rather than ask us to do it.” (Non-specialist, low volume)

However, it is important to note that many respondents did not view this potential change as relevant for them but could see how it may be helpful for others.

5.4 Auto-fill

Most respondents viewed a form remembering one’s information, or ‘auto-fill’, as helpful. The key information the form would need to remember includes National Insurance number, business and occupation information, and past travel. Some agents have data security concerns and also expressed uncertainty over how an auto-fill function would work if remembering the information of multiple different clients.

“That would be perfect and good across any forms across the board - it would be a game changer. As an accountant, I hate filling out forms, so if it saved me time, I’m happy so I can get on with my actual work.” (Non-specialist, low volume agent)

5.5 Change of circumstances form

Respondents commonly did not re-apply, so this was seen as less necessary to most. Some would use a change of circumstances form if there was one – particularly those staying in the same country for longer. Most specialist agents welcomed the idea of a change of circumstances form, but one smaller agent was concerned about the loss of business they would experience if managing extensions was no longer needed by clients.

5.6 User ideas

Respondents were asked about other changes they would like to see that would improve the application process. Additional ideas from respondents can be grouped as changes to the form, streamlined communication methods and changes to the overall application system.

5.6.1 The form and certificate

Respondents would like to see various changes to the application form itself. These include:

a facility to upload attachments for non-EEA/Swiss applications
reducing the number of questions asked on the forms
increasing the space allotted to list countries and dates on application forms for multi-state workers, or ideally remove the need to list them all
removing questions that require similar information about work outside the UK
making it possible to apply for groups at a time

“The [inability to upload attachments to certificate of continuing liability applications is] is my biggest bugbear.” (Non-specialist, low volume agent)

introducing readable QR codes instead of PDF certificates

5.6.2 Communication

Respondents would like to see changes to the way they interact with HMRC, and better communication between HMRC and other countries. Some ideas include:

communicating that the application process is unchanged post-UK’s exit from the EU
re-introducing dedicated caseworkers for high-volume agents
better communication between countries on certificate requirements
improving signposting to HMRC guidance on how to fill out the application

5.6.3 System

Respondents referred to various aspects of the application system that they would like to see improved. For example, some agents thought that the level of errors on certificates is due to people having to manually input data at HMRC. Therefore, they would like HMRC to automate areas of data input in the certificates to reduce the level of errors and reduce human input. Other ideas include:

a fast-track method for short-notice applications
enable employees to fill out form themselves online and not just by post
establish a connection between Self Assessment and certificates

“HMRC need to find ways to reduce human input in the process…. [mistakes] makes us believe there is a human intervention here.” (Specialist, high volume agent)

Term	Definition
Form	The application form to obtain a certificate from HM Revenue and Customs (HMRC).
Certificate	The final certificate received. Certificates are commonly known as either an ‘A1’ or a ‘certificate of continuing liability’ depending on the social security co-ordination agreement.
A1 certificate	This certificate is issued by HMRC to those relying on either: The UK/EU Withdrawal Agreement (the WA), or The EEA-EFTA Separation Agreement, or The UK/Swiss Citizens’ Rights Agreement, or The UK/EU Trade and Cooperation Agreement (the TCA) to pay UK National Insurance contributions only when working in one or more of these countries.
Certificate of continuing liability (CCL)	This certificate is issued to those relying on the UK’s other social security co-ordination agreements to pay UK National Insurance contributions.
S1 certificate	This certificate is issued by HMRC, on behalf of the Department of Health and Social Care, to those workers who are liable to pay National Insurance contributions but reside in another country covered by either: the UK/EU Withdrawal Agreement (the WA); or the EEA-EFTA Separation Agreement; or the UK/Swiss Citizens’ Rights Agreement; or the UK/EU Trade and Cooperation Agreement (the TCA). This certificate demonstrates to the worker’s country of residence that the worker’s, and their family members’, healthcare costs are covered by the UK.
Detached worker	May also be referred to as a ‘posted worker’. A detached worker is either: an employee who works for an employer in one country (their home country) and is sent to work temporarily in another country (the host country); or a self-employed person who normally carries out an activity in one country (their home country) who temporarily carries out a similar self-employed activity in another country (the host country).
Multi-state worker	A multi-state worker is someone who works regularly (either alternately or simultaneously) in more than one country. A multi-state worker normally pays into the social security scheme where they reside if they carry out a substantial activity there.
Joint Forum on Expatriate Tax and National Insurance (Expat Forum)	The joint forum is a partnership between HMRC, employers, professionals and payroll advisers to improve liaison between HMRC and its customers and the operation of the tax and National Insurance contributions (NICs) system for all international secondments of labour (inbound and outbound).
European Economic Area (EEA)	Comprised of EU countries (Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden) and Iceland, Liechtenstein and Norway.
EEA-EFTA countries	The EEA-EFTA countries are: Iceland, Liechtenstein and Norway.
Reciprocal Agreement countries	Non-EEA/Swiss countries or territories with which the UK has social security agreements; that, amongst other things, coordinate the payment of contributions. These are: Barbados, Bermuda, Canada, Chile, Gibraltar, Isle of Man, Israel, Jamaica, Japan, Jersey & Guernsey, Mauritius, Philippines, Bosnia-Herzegovina, North Macedonia, Serbia, Montenegro, Kosovo, South Korea (also known as The Republic of Korea), Turkey, USA.

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1. Executive summary